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Bajaj Consumer
Our verdict on Bajaj Consumer isn’t the consensus take — see where we landed, and the one risk the bull case glosses over.
See the verdict — free →Does management do what it says?
Management delivered a significant 400-plus basis point improvement in consolidated EBITDA margins, reaching 18.6% in Q2 FY26. (2 exceeded across 2 tracked commitments)
“With these initiatives and supported by calibrated pricing, we will work towards delivering improved operating margins in the year.”
The company achieved double-digit consolidated revenue growth of 13.3% in Q2 FY26, with the core brand ADHO also delivering double-digit revenue growth in India. (1 met, 4 exceeded across 5 tracked commitments)
“Looking ahead, we will continue to focus on reviving double-digit revenue growth with a strong focus on supporting our core brand Almond Drops”
See the full cited Management analysis of Bajaj Consumer
How durable is the business?
Gross margins improved significantly to 56.6% (up 140 bps YoY) due to better product mix and price increases in the oil portfolio. (4 expanding)
“The gross margin for the quarter on a stand-alone basis stood at 56.6%, an improvement of 140 basis points year-on-year... on back of improved product and SKU mix, along with price increases in our oil portfolio.”
ADHO revenue grew by 4% in Q1 FY26, arresting a multi-quarter volume decline. Growth was broad-based across all pack sizes, including sachets and small packs, signaling a potential consumption revival. (5 expanding)
“We've delivered a growth of 4% on ADHO and have arrested the volume decline on the brand after several quarters.”
See the full cited Business Model analysis of Bajaj Consumer
Where does growth come from?
The company is aggressively reinvesting in its core brand, increasing A&P by 46% for ADHO to regain market share. (5 accelerating across 5 signals)
“Advertisement & Sales Prom. Q4 FY26 49.4 YoY% 34.0%”
The company is gaining more ground in the hair oil market, increasing its portion of total sales compared to competitors. (+1 more signal)
“We continue to register volume market share gains on the brand on a quarterly as well as a MAT basis.”
See the full cited Future Growth analysis of Bajaj Consumer
What could break the thesis?
The company completed the 100% acquisition of Vishal Personal Care (Banjara's) to diversify into the Natural and Herbal segment and is scaling non-ADHO products in modern trade. (1 easing, 4 stable, 1 high-severity)
“So value-add, basically, Shirish, for us, if you were to look at within value-added hair oil, 98% of value-added hair oil is ADHO”
The risk is intensifying as management confirms nearly 100% of the cost base is under inflation, with specific volatility in LLP and packaging due to the Gulf conflict, and delayed price cooling in mustard and copra. (2 intensifying, 2 easing, 1 stable, 2 high-severity)
“On input costs, the war in the Gulf has created extreme volatility in the prices of LLP and packaging material. It has also delayed the price cooling in case of mustard and copra... nearly 100% of our cost base is under inflation.”
See the full cited Risk analysis of Bajaj Consumer
Read the full thesis on Bajaj Consumer
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